TDS on Rent applicable

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This discussion clarifies TDS on rent for a proprietorship business. Previously, audit requirements meant TDS wasn't applicable. However, with an annual turnover exceeding Rs 1 crore in FY 2021-22, TDS on rent payments of £38,000 per month becomes applicable from FY 2022-23. The key point is that TDS must be deducted from the first month of the financial year once the threshold is crossed, not after exceeding the annual exemption limit.

Husseini

Husseini (Querist)
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17 January 2022 The Assessee is holding Proprietorship company, till F.Y.2020-21 income tax audit is not applicable, In F.Y.2021-22 Annual Turnover will be above Rs. 1 Cr.

we are paying rent Rs.38000/-p.m to landlord. I would like to know whether TDS on rent should we deduct 10% TDS from the first month of financial year or after crossing the limit of exemption of Rs240000/-.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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17 January 2022 TDS has to be deducted from first month as you know in the beginning of the year the rent payment exceed threshold.

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Husseini

Husseini (Querist)
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17 January 2022 While searching in my query, I found one of the expert reply is
Individual is required to deduct TDS only if his Books of accounts in preceding year audited under section 44AB of the income tax Act, 1961. is it right

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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17 January 2022 Yes, it's right In the FY 2022-23 only TDS applicable for you.

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